Source: PaxForex Premium Analytics Portal, Fundamental Insight
EV cars maker Tesla is finally to begin ramping up production of its long-awaited semi-truck, and the first sales are set to start Dec. 1. When the Tesla Semi has introduced back in 2017, the idea was to present it to the market within the following two years.
The new all-electric truck with 500 miles of range will be the company's first commercial vehicle, CEO Elon Musk said last week on Twitter. More importantly, the start of production is a signal that some of the automaker's production issues are alleviating, as the truck's postponed launch was mainly due to supply chain problems.
While investors probably read about the Tesla Semi when it was announced in 2017, enough time has passed that it makes sense to talk again about the upcoming vehicle. At the time of the unveiling, the car's 500-mile range was conceivably the greatest jaw-dropper. Surprisingly, this evaluated range is possible with a gross vehicle weight of 82,000 pounds, or the total weight of the car, cargo, passengers, and trailer altogether.
For you to realize the progress, Tesla's entry-level Model 3 has a range of 267 miles. The Model S can travel about 375 miles on a single charge.
As per the electric car company's website, Tesla will also eventually bring a 300-mile range version of the car to market. But in his tweet last week, Musk noted only the start of production of a 500-mile range version.
Other noteworthy features of the truck include an acceleration time from zero to 60 mph in 20 seconds, a 70% charge in 30 minutes using Tesla Semi chargers, over-the-air software updates, and remote diagnostics.
One of the main reasons Tesla waited until late 2022 to start delivering the Tesla Semi was supply chain issues. Last year, much of the company's resources and focus were devoted to various production issues. Because supply chain problems will continue into 2022, company executives actually said in their January earnings call that they would not introduce any new products this year. "It wouldn't make any sense because we would still be short on parts," Musk explained.
Since Tesla has already begun production of the Tesla Semi, and the first deliveries of the new vehicle will begin on Dec. 1, perhaps the company's production constraints are improving.
The company's quarterly deliveries certainly show signs of accelerating production, further anecdotal evidence of an improving supply chain. Third-quarter shipments were a record 325,000 units, up 42% YoY and 35% sequentially. But even those numbers understate the company's production progress, as it had an abnormally high percentage of cars in transit to customers at the end of the quarter. Total production for the quarter was about 366,000 units, up more than 41% from the previous quarter.
Of course, investors should keep in mind that Tesla Semi deliveries in 2022 will likely be limited. Indeed, Musk mentioned only one customer that started deliveries on Dec. 1 - though that's a pretty big customer. That's Pepsi, which has reportedly booked 100 Tesla Semis.
Still, it's not unusual for the first deliveries to be limited - especially for Tesla. The company's production of new cars typically follows an S-curve, with slow production growth first and then a sharp acceleration.
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Alternative scenario:
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- Time frame: D1
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